The mystery of Findora: The DeFi project suddenly disowned by its founders

Whatever is going on behind the scenes at Findora, most of the DeFi project’s founding team suddenly wants nothing to do with it.

On December 21, Charles Lu, Benedikt Bünz, and Benjamin Fisch — each of whom had held core roles in the California-based project — simultaneously tweeted that they are no longer associated with Findora and have no involvement with its recently announced initial coin offering.

The tweets came two days after an anonymous account on the Chinese question-and-answer site Zhihu published an article that challenged Findora’s legitimacy and pointed out the apparent exodus of nearly the entirety of its previous team during the past two months.

Findora denied the thrust of the Zhihu post and claimed that it restructured its team with new hires at the end of November.

But according to people familiar with the situation, the original founding team’s departure was due to their concerns over the recent actions of two of Findora’s principles, named Lily Chao and Damien Leung, who were also members of the original founding team.

The people said the team recently discovered that Chao and Leung had been soliciting private token raises since June this year, primarily from Chinese investors, without the rest of the team’s knowledge.

Last week, the mystery deepened when it was reported that crypto VC firm Polychain led an “eight-figure” token investment in Findora along with several Chinese VCs. But sources with knowledge of those deals told The Block that in fact they occurred last year. While several Chinese VCs invested in Findora in recent months, the last time Polychain invested in Findora was in November 2019, the people said.

The sources speculated that Findora’s current representatives had pitched the story to media outlets to draw attention to its ICO, which is scheduled to launch on December 28.

Meanwhile, who exactly is now calling the shots at Findora remains unclear.

Mysterious mass exodus

Findora, which launched in July 2019, says on its website that it is using zero-knowledge proofs to develop decentralized financial applications that are confidential yet publicly auditable.

The founding group featured several individuals affiliated with Stanford University: Ph.D. students Lu, Fisch, and Bünz in addition to John Powers, the late former CEO of the university’s endowment fund, and Professor Dan Boneh.

An archived “About” page from Findora’s website dated October 20 lists Lu as Findora’s CEO, Fisch as a co-founder and CTO, and Bünz as co-founder and head of research. Lily Chao is listed as a founder.

The archived web page also indicates that the project had at least 22 members on its operations team including engineers, cryptographers, product and marketing executives. It also shows that Findora had five advisors, including Balaji Srinivasan, an angel investor and the former CTO of Coinbase, whose role was announced in 2019.

But in November, Delaware-based Temujin Labs, the firm behind Findora, filed a lawsuit against Lu, Fisch and a U.S. investor Ariel Abittan. The firm alleged that a “mass resignation” of its employees was due to Abittan’s assertion that he owns a majority of the company, and accused Lu and Fisch of breach of contract.

A more recent archived website shows that the company deleted the page listing these team members sometime before November 4. Srinivasan and two other former advisors — Stanford's Boneh and City University of New York professor Rosario Gennaro — are also no longer listed on Findora’s website.

On November 6, Fernando Krell, a former cryptographer at Findora, wrote a one-sentence post on his Medium page: “I do not longer work at Findora.”

In a December 22 tweet, Srinivasan said he “stopped advising Findora some time ago” and voiced support for Fisch, Bünz and Boneh in “whatever they do next.”

In an email response to The Block, Gennaro said: “I do confirm that I have resigned from my advisory role at Findora. I do not wish to make any additional comment.”

A communications rep from Findora did not respond to The Block’s inquiries for this article. A representative from an associated PR agency told The Block the Findora ICO is not aimed at U.S.-based investors but did not provide answers to previous questions about the project team.

Who is behind the ICO?

Findora’s current website has no dedicated team page, but its new token sale site advertises that it has five contributors, eight researchers and one advisor.

In a WeChat blog post on December 21, Findora claimed it has hired new engineers and cryptographers to lead its development.

The five researchers that recently joined Findora — at least, according to its website — are all university professors. When reached out for clarification of their exact involvement, Dominique Schröder, a professor of computer science at the University of Erlangen-Nürnberg, said: “Since I joined recently, I’m not familiar with all details and would kindly ask you to direct your questions to Damien (CC) directly.”

“Damien” refers to Damien Leung, one of the two Findora principals apparently leading Findora’s private and current public token sale efforts. But their exact identities and backgrounds are unclear. The full name listed in Schröder’s message was “Damien Ray Donovan,” and the associated email address was damien@findora.org.

The Block couldn't find any search results on Google for the name “Damien Ray Donovan.” But the email address also appears on the July 2020 version of Findora’s project whitepaper, next to a different name: Damien Leung. Damien Leung was mentioned as Findora’s COO in an August 2019 event in Silicon Valley.

There’s also the Telegram user with a handle “Cryptolong8” who created Findora’s new official Chinese Telegram group on October 31 and introduced himself in written Chinese as Liang Jiancun and called himself Findora’s COO. (Liang and Leung are variants in romanized spelling of the same surname in Chinese writing.)

The person behind Cryptolong8 appears to be active on Findora’s Telegram group in partnership with Lily Chao’s admin Telegram handle.

Few details about Chao’s background can be found online. Though she was previously listed as a founder of Findora on its website, now she is called a “General Contributor,” and described her role as “People person at Findora.”

Chao appeared on a message-based AMA hosted by a Chinese media site on October 18 to introduce Findora to Chinese audiences with another Findora representative Eli Reinhardt. But people familiar with the process told The Block that Reinhardt was impersonated since he did not participate in or authorize anyone to represent him in the AMA.

Cryptolong8 and Chao have recently interacted with members of Findora’s English and Chinese Telegram group regarding its upcoming token sale. When challenged by users with questions about who is serving as the current CEO of Findora, both appealed to the project’s “decentralization.”

“CEO is not a title at Findora. We are a decentralized foundation aiming to build a new global financial network. The decision making is democratic with governance practice,” Cryptolong8 responded on Findora’s English Telegram channel on December 17.

Later Chao chimed in, too: “Dear, blockchain is decentralized. Bitcoin does not have CEO also.”